各校計畫成果

活動簡介

Whether long-term partnerships can be efficiently run is a long-standing question in the theory of repeated games. In this project, we characterize the minimum efficiency loss to enforce a desired outcome in a long-term relationship between a principal and a group of players. A central concept in our analysis is the notion of self-evident events, which was introduced by Aumann (1976) to analyze players’ beliefs in incomplete-information games. We apply the concept of self-evident events to derive a lower bound on the long-run efficiency loss. We prove that the bound is tight when the length of the relationship is sufficiently long. Our results help explain why cartels can often collude effectively even when it cannot closely monitor the sales and prices of their member firms.